And I’ll just remind you on that. If you think about the enterprise and office space where Pitney Bowes has traditionally had its bread and butter from a mailing perspective, we have relationships and brand reputation in that space that’s allowed us to move into that office shipping space very aggressively. If you think about our SaaS business this past quarter, we grew our SaaS revenue on the shipping side 40%. And if you look under the covers of what we’ve been able to do in the enterprise space, so think about large clients, Fortune 500 companies, we actually grew our SaaS revenue 61% in first quarter. So as you think about shipping as a growing part of that business portfolio going forward, and offsetting the natural decline that you have in the Mailing business.
Our job is really two parts. One is to stem the mailing decline as best we can, and we’ve demonstrated that we’ve been able to do that by introducing new value and new products. And second, to begin to grow into an adjacent space, shipping now is going to be somewhere north of $230 million, $240 million of revenue this year as part of that portfolio, it’s a tremendous growth success story that we’re going to continue to leverage as we go forward.
Matthew Swope: That’s great. Thank you on both of those. And then just a last one for me. On GEC, you guys have talked in the past about one of the things driving the revenue per piece down being lower weight per piece. Can you talk about that trend and where that sits now?
Jason Dies: Yes. Look, I mean I’m not going to get into parsing the types of volumes necessarily because I think to some degree, that’s going down a rabbit hole. But you are correct. If you look at the market as a whole, the market as a whole has been affected by increased volumes coming from Asia and China in particular. Those volumes, think about things like Temu, Alibaba, those types of places, tend to come in at a much lower weight, which definitely impacts the rate per piece as you go as you prosecute the business. That said, there’s always opportunities from a mix perspective. There’s always opportunities that you have to try to go after improvements in rate per piece. What I will tell you is this market is very hard right now with the overcapacity that’s out there.
I think the USPS had a number that said there’s about a 12 million parcel a day overcapacity across the entire country. And until that begins to normalize a little bit, I think you’re going to continue to see pressure on that rate per piece.
Matthew Swope: Great. Thanks Jason, for all the answers.
Jason Dies: Thank you, Matt.
Operator: Your next question comes from the line of Will Brunemann from Northcoast Research. Please go ahead.
Will Brunemann: Hey, guys. So I was going to ask you about what you’re seeing in the current environment for Global Ecommerce. And are you guys seeing pricing competition on that side stabilize? And then I have one follow-up.
Jason Dies: Yes. Look, what I would say is pricing competition remains very robust. And again, it stems from this overcapacity piece that we’ve talked about a few times. I will tell you, our win rates in the market tend to be about what they’ve been over the past few quarters. So we think we’re competing effectively. And if you look at the fact that we’ve been able to bring in new clients and new volumes into the network for GEC, I think that demonstrates the fact that we have a client value proposition that’s resonating. That said, it is a dogfight out there, and you’re constantly fighting for volumes across the board as everyone seeks to try to put it in packages that will fill their network and offset their fixed costs.
Will Brunemann: Awesome. I think that answers my question. And then I also wanted to ask you guys. So the Presort business performed really well this quarter on the margin side. Are you guys seeing those margins as sustainable long-term?
Jason Dies: Yes. Look, I mean – no, I think that’s a fair question. And the way I will say it is this, I think the Presort team has demonstrated the ability to continue to drive improvements in their business over time. That said, just like any business, it has headwinds. It has labor headwinds, has inflationary pressures from suppliers. We’ve been very effective at overperforming against those headwinds. And I’m not sure that I would say that you can expect that we’re going to continue to overperform at the rate and pace that you saw in the first quarter. But we do think that we have opportunity and the ability to continue to drive EBIT margin improvement and EBIT improvement in that business as we look forward.
Will Brunemann: All right. Thank you. And good job on the quarter.
Jason Dies: Thank you
Operator: Your next question comes from the line of Peter Sakon from CreditSights. Please go ahead.
Peter Sakon: Good morning. I was pleased to see the improvement in corporate overhead. Can you talk about what the largest items are? And should we expect similar improvements throughout the rest of the year?
Jason Dies: Yes. Look, I’m not going to get into specific areas that we cut on corporate overhead. What I will tell you on this is, again, as we talk about this, and I’ve said this in previous quarters, my goal is to get cost out of the business. My goal is to simplify the business, make us more efficient, more effective, bring speed to the business, and we’re going to take that cost out wherever we find it to take out I talked last quarter, I believe, about one of the things that we did is we did a pro forma allocation for our business unit leaders of our corporate costs so that they could have more control and more say over what it is that they want to pay for and what they think is effective in driving the business. We’re going to continue to focus on that and we’re going to continue to take cost out as we go through the second half of the year.
We were very successful in our restructuring program that we announced last year. We said, John and I both said that we are overperforming on that. You can think about that as over 1,000 heads out of the business based on the program that we announced previously. John mentioned we’ve got a third party in and we’re going to continue to look for opportunity as we go through the rest of the year to take significant chunks out of that cost as well. But again, I want the business unit leaders who are delivering for clients and delivering for shareholders to be the arbiters of what they see value in from a corporate perspective, and I think that’s important.
